Listed compoany Sansiri will launch three developments in Phuket in the coming weeks. The developments are valued at more than two billion baht. Future plans for Phuket include another development in the upscale market segment. The company is a clear winner at the Bangkok Stock Exchange less than three weeks into 2012 trading. Sansiri generate profit of 2.28 billion baht in 2012.
The developer is expecting a good response from Phuket clients following the sell-out success of the first dCondo development in Q3 2011. In addition to launching their second dCondo development, Sansiri will launch two housing developments “Habitia” and “Habitown” in February, in line with the company’s expansion plans on Phuket.
Mr. Suriya Wannabuit, Executive Vice President – Project Management and Marketing Department of Sansiri Public Company Limited, revealed that after the company announced its plans to expand into the Phuket market in the last quarter of 2011, Sansiri had a successful launch and sales of its first development in Phuket ‘dCondo Kathu’, with 556 units sold out within half-a-day. The company is confident and committed to expanding the company’s portfolio on Phuket Island further. In the first quarter of 2012 Sansiri is launching its second dCondo development, “dCondo Kathu-Patong”, value THB 800 million, and comprises of 653 units. The opening sales event is set for January 27-29, and the developer is expecting “dCondo Kathu-Patong” to be well received with strong sales.
“We are proud to introduce the second dCondo which is “dCondo Kathu-Patong”. The success from dCondo Kathu launched in the last quarter of 2011 has proved that clients in Phuket believe and trust in developments by Sansiri. “dCondo Kathu-Patong” is located on the main road (next to the Tessaaban Kathu-Patong, in Kathu district), which is easily accessible, located in the heart of the business and leisure area of the Island. Our target audience is working people who are looking for a residence that is conveniently located and has easy access to travel, entertainment and shopping areas, as well as easy connections to Phuket Town and Patong.
Sansiri plans to push forward in the Phuket market with another two brands: “Habitia”, semi-detached houses; and two-storey townhouses under the brand “Habitown”. Both are planned to launch in February this year. Together, all 3 developments are valued at THB 2BN. Future plans for Phuket include another development in the upscale market segment.
The “dCondo Kathu-Patong” is located on an area of 5-2-50 rai, comprises three low rise eight-storey buildings and 663 units of 28-29 square metres. Each unit at “dCondo Kathu-Patong” has a holistic functional design, maximizing every square metre to meet the lifestyle needs of Sansiri customers, featuring a relaxing area, bathroom and separate kitchen. The development has complete facilities including a green area, fitness room and swimming pool, as well as a security system equipped with 24-hour CCTV and key card access. Prices start at 999,000 baht. “dCondo Kathu-Patong” has developed on the previous project design by adding more windows in corner rooms, to increase air flow and add more light.
Several analysts have upgraded the valuation of the company in early 2012. Net profit for 3Q11 rose 29.3%.
The company will present its 4Q earnings in February.
“We reiterate BUY on SIRI after revising up the net profit forecasts for 2011-12 by 31.1% and 31.6%, respectively. Presales and transfers are set to beat the street consensus. With strong earnings growth of 46% and 25% for 2012-13, the company will soon prove that it does not deserve a deep PER multiple discount”, according to analyst Polasit Tanpoonkiat at KT Zimco in Bangkok.
KT Zimco has a BUY reccommandation on the stock, which traded at 1.2 baht on the last day of 2011. Less then three weeks later it is at 1.78 baht – an increase of almost 50 percent. Khun Polasit expects the stock to reach 2.22.
Management set an ambitious transfer (revenue) target of Bt27bn, up nearly 40% YoY, based on 40 new projects worth Bt40bn. The new prefab plant should shrink construction time for low rise to 2-3 months from eight months, thus improving the cash cycle. However, heavy launches will push the leverage ratio higher.
“We conservatively forecast transfers for 2012 of Bt23.8bn, up from Bt17.5bn (cut during flood). Our net profit forecasts are lifted by 31.1% and 31.6% for 2011-12, respectively. Note that we are also aware that net gearing will rise further to 1.7x, but we are not overly concerned as the property market remains quite healthy”, argues Khun Polasit.
